Jesus, it always pisses me off when I see all these businessmen who either have their heads in the clouds or are too arrogant to realise what's going on.
[release]Industry experts say operators can offset any losses through effective costing plans by mobile networks.[/release]

Yeah, you believe that. I mean, the music industry stopped the walkman didn't it? She'll be right, mate. She'll be right.

I mean don't these apps use internet and the phone companies charge shitloads for internet, so how are they losing money?

While Internet is usually more costly than texts, on a per-use basis, consider this.

Let's assume there is a Network A, which charges $60 a month for unlimited Internet usage, and $0.15 per text message using their service.

It would take 400 text messages, at $0.15 per message, to equal the same as the $60 for unlimited Internet. This is over a span of a business month, typically 30 days. This averages out to 13 texts a day. I don't personally own a phone with texting capabilities, but I know people who do - and a single texted conversation takes up about 10 texts, BY ITSELF, if not more. So 13 texts a day is a number easily achieved, and easily surpassed. What's more, according to a 2010 article on MSNBC.com, The Average American Teenager Sends and Receives 3,339 Texts Every Month. This would translate, at $0.15 a text, to $500 a month.

Once a person begins to text more than 400 times a month, it becomes cheaper to pay the $60 a month for unlimited Internet, and use a free-to-use texting app (like Facebook) on that Internet.

Assuming that Customer A sends 3339 texts a month, then the amount of POTENTIAL REVENUE Network A is losing to this customer is $440 a month, assuming Customer A uses the $60/month Internet as opposed to the $0.15/text plan.

And then this isn't even taking into account that most networks charge higher fees for texts that go long distances, and even more for international texts, whereas the unlimited Internet plan wouldn't be affected by distance.

While Internet is usually more costly than texts, on a per-use basis, consider this.

Let's assume there is a Network A, which charges $60 a month for unlimited Internet usage, and $0.15 per text message using their service.

It would take 400 text messages, at $0.15 per message, to equal the same as the $60 for unlimited Internet. This is over a span of a business month, typically 30 days. This averages out to 13 texts a day. I don't personally own a phone with texting capabilities, but I know people who do - and a single texted conversation takes up about 10 texts, BY ITSELF, if not more. So 13 texts a day is a number easily achieved, and easily surpassed. What's more, according to a 2010 article on MSNBC.com, The Average American Teenager Sends and Receives 3,339 Texts Every Month. This would translate, at $0.15 a text, to $500 a month.

Once a person begins to text more than 400 times a month, it becomes cheaper to pay the $60 a month for unlimited Internet, and use a free-to-use texting app (like Facebook) on that Internet.

Assuming that Customer A sends 3339 texts a month, then the amount of POTENTIAL REVENUE Network A is losing to this customer is $440 a month, assuming Customer A uses the $60/month Internet as opposed to the $0.15/text plan.

And then this isn't even taking into account that most networks charge higher fees for texts that go long distances, and even more for international texts, whereas the unlimited Internet plan wouldn't be affected by distance.

That's where their potential revenue loss comes from.

Now I'm tempted to get internet.

But If you spend £10 on Orange you get thousands of free texts and 50MB of free internet..so now I'm confused still.

Well currently I'm on Giffgaff in the UK, so if I top up 10 pound I get unlimited free texts (properly unlimited), unlimited internet (properly unlimited) and 250 mins of phone calls (hardly used). So I still use SMS all the time. And trust me, I send a lot of texts.

I use the facebook chat app thing instead of texting nowadays, it's a lot faster. It makes no difference to the phone company though so I'm on contract and I'm still technically paying for the 3000 texts a month that I never use.